Monthly Archives: November 2009
Politicians are hoping for a short term recovery and so is the public. Though the utter nonsense and stupidity behind a premise of a jobless-recovery really should test the limits on how naive the U.S. media is. Many see the high possibility of another deep crash but will we prepare for it – or hope that our wonderful stimulus/bailout solved our deep underlying problems.
Short Selling American Lives
Deutsche Bank Life Insurance Fund in Hot Water
By Anne Seith in Frankfurt
Gerhard Strate, a well-respected lawyer based in Hamburg, has seen a lot of things over the years. But he still has a hard time believing the story of the Deutsche Bank funds db Kompass Life 1 and 2, calling it “unbelievable” and “absurd.” The closed-end funds buy life insurance policies from Americans and assume responsibility for paying their future premiums. When the original policy-holder dies, the entire payout goes to the fund. It is like short-selling US life expectancy.
Deutsche Bank collected some €500,000 ($750,000) from customers for its macabre money-making scheme. But the fund quickly turned into a mega-flop. So far, not one investor has received even a single dividend payment and some may lose their entire principal.
Now, Strate has filed a criminal complaint with public prosecutors in Frankfurt on behalf of one of those who invested in the fund. A lawyer from Munich has also announced his intention of filing a complaint of his own, believed to be on behalf of dozens of clients. He is also preparing claims for damages.
‘Investors Knowingly Misinformed’
There is cause to suspect “that from the very beginning, the promised dividends were not achievable using any realistic suppositions,” Strate wrote in his complaint. In addition, he says, investors in the two funds were not adequately informed about one aspect of the scheme’s structure: that both funds invest to a large degree in the same policies, thus “making risk management practically impossible.” Thus, he argues, the funds may have crossed the line into fraud or at least breach of trust. “Finding out exactly which is a job for the public prosecutors,” Strate said.
Karl-Georg von Ferber, a lawyer who represents an association of investors, points to the db Kompass Life 1 annual report for 2006. The policies that had been purchased by the fund are listed in detail. Only two of them had an estimated policy period of four years or less with many listed as not maturing for 10 years or more. Nevertheless, the report promised investors a return of 7.5 percent per year beginning already in 2007. “The way I see it, investors were knowingly misinformed,” Ferber says.
Deutsche Bank has refused to comment on the criminal complaints. The bank explains away the funds’ non-performance by pointing to the recent increase in US life expectancy. As a result, they wrote to investors, “fewer policies matured than expected.” Mortality tables, upon which the funds are based, have changed since 2005, the bank explained.
Getting Away Cheaply
A Deutsche Bank spokesperson rejected accusations that the bank has misled investors. The bank, the spokesperson said, “has always accurately communicated the current situation in the business covered by the funds.” Forecasts of life expectancies could not be seen as “absolute numbers” to be used to calculate the cash-flow situation, the bank said. Instead, the bank calculates probabilities for premature or delayed deaths.
Nevertheless, the bank — in the interest of “fairness” — recently made the angry investors an offer: Should they wish to pull their money out of the funds immediately, Deutsche Bank will grant them 80 percent of their original investment. The funds’ rules call for money to stay put until 2015. The offer deadline expires in just a few days. But the investor represented by Strate does not intend “to allow the bank to get away so cheaply.”
People take no offense to these thoughts – my thoughts just like everyone else are molded from many different opinions/facts and individual morals.
Health Care debate – I have listened, read up, studied, and been bombarded with facts, lies, and half-truths about this. The far left would like to see universal health care while others want a public option. The talking heads on the right would like to see certain market-solutions that either barely bring down costs or pretend to. In either case what we have now (the best we came up with) is a plan that gives billions to a corrupt (im being nice when i say corrupt) massive pharma industry. Also in this provision it forces under law that one must buy into the insurance plan or be faced with a $250,000 fine or face prison time. It also helps cover at a lower cost millions that were uninsured. The real question is does the U.S. government have the money to fund a big program as such that will cost over 3/4 of a trillion dollars? The answer inevitably is a resounding NO! The U.S. government has $100 trillion in unfunded liabilities (Social security, FDIC, medicare, ect) finding the money for these is already being seen as an impossibility. Why on earth would we even consider a government-run program while we have 2 wars waging that are costing us hundreds of billions if not trillions of dollars to wage? If it was truly the cause for Obama and democrats to create a government program why not then end these two wars and then figure out our fiscal situation in which to fund a program. Instead this endless spending goes on with the hope that our future generations will find a way to dig us out of our black hole of debt and government liabilities. Like a black hole though if we pass more entitlements from the state we reach our event horizon where there will be no way of getting out of this black hole of debt. Our country and future generations will suffer the consequences. Let us hope that we have not already reached the event horizon. Maybe sometime in the future we can fund universal health care or other enormous expansions (I wouldn’t suggest it for many reasons) but our government like any other responsible individual should know we must plan for the future.
Suggested reading : The Henry Ford of Heart Surgery’s — http://online.wsj.com/article/SB125875892887958111.html
Those who don’t plan for the future; plan to fail
“My interest is in the future because I am going to spend the rest of my life there.”
Charles F. Kettering
Politicians are the only people in the world who create problems and then campaign against them.
Have you ever wondered, if both the Democrats and the Republicans are against deficits? WHY do we have deficits?
Have you ever wondered, if all the politicians are against inflation and high taxes, WHY do we have inflation and high taxes?
You and I don’t propose a federal budget. The President does.
You and I don’t have the Constitutional authority to vote on appropriations. The House of Representatives does.
You and I don’t write the tax code, Congress does.
You and I don’t set fiscal policy, Congress does.
You and I don’t control monetary policy, the Federal Reserve Bank does.
One hundred Senators, 435 Congressmen, one President, and nine Supreme Court Justices equates to 545 human beings out of the 300 million Americans are directly, legally, morally, and individually responsible for the domestic problems that plague this country.
I excluded the members of the Federal Reserve Board because that problem was created by the Congress. In 1913, Congress delegated its Constitutional duty to provide a sound currency to a federally chartered, but private, central bank.
I excluded all the special interests and lobbyists for a sound reason. They have no legal authority. They have no ability to coerce a senator, a congressman, or a president to do one cotton-picking thing. I don’t care if they offer a politician $1 million dollars in cash. The politician has the power to accept or reject it. No matter what the lobbyist promises, it is the legislator’s responsibility to determine how he votes.
Those 545 human beings spend much of their energy convincing you that what they did is not their fault. They cooperate in this common con, regardless of party affiliation.
What separates a politician from a normal human being is an excessive amount of gall. No normal human being would have the gall of a Speaker, who stood up and criticized the President for creating deficits. The president can only propose a budget. He cannot force the Congress to accept it.
The Constitution, which is the supreme law of the land, gives sole responsibility to the House of Representatives for originating and approving appropriations and taxes. Who is the speaker of the House? Nancy Pelosi. She is the leader of the majority party. She and fellow House members, not the president, can approve any budget they want. If the president vetoes it, they can pass it over his veto if they agree to.
It seems inconceivable to me that a nation of 300 million can not replace 545 people who stand convicted — by present facts — of incompetence and irresponsibility. I can’t think of a single domestic problem that is not traceable directly to those 545 people. When you fully grasp the plain truth that 545 people exercise the power of the federal government, then it must follow that what exists is what they want to exist.
If the tax code is unfair, it’s because they want it unfair.
If the budget is in the red, it’s because they want it in the red …
If the Army & Marines are in IRAQ, it’s because they want them in IRAQ
If they do not receive social security but are on an elite retirement plan not available to the people, it’s because they want it that way.
There are no insoluble government problems.
Do not let these 545 people shift the blame to bureaucrats, whom they hire and whose jobs they can abolish; to lobbyists, whose gifts and advice they can reject; to regulators, to whom they give the power to regulate and from whom they can take this power. Above all, do not let them con you into the belief that there exists disembodied mystical forces like “the economy,” “inflation,” or “politics” that prevent them from doing what they take an oath to do.
Those 545 people, and they alone, are responsible.
They, and they alone, have the power.
They, and they alone, should be held accountable by the people who are their bosses.
Provided the voters have the gumption to manage their own employees.
We should vote all of them out of office and clean up their mess!
Charlie Reese is a former columnist of the Orlando Sentinel Newspaper.
What you do with this article now that you have read it……….. is up to you.
“We have slept through the annihilation of Afghanistan, Iraq, and Palestine, a war with Islam, the rendition of terrorist suspects, prisoner abuse and torture, the suppression of civil liberties, citizen surveillance, corporate greed, pandering to the rich and powerful, global warming, full spectrum dominance, imperial overstretch, and a culture of deceit. Massive military spending, multi-trillion dollar deficits and Wall Street bailouts, mounting trade deficits, and a precipitous decline in the value of the dollar have gone virtually unnoticed.
During our long period of slumber the United States government has lost its moral authority. It is owned, operated, and controlled by Wall Street and Corporate America. The United States has become ungovernable, unfixable, and, therefore, unsustainable economically, politically, militarily, and environmentally. It has evolved into the wealthiest, most powerful, most materialistic, most racist, most militaristic, most violent empire of all times.” – Thomas Naylor